Public Private Partnerships for economic development are complex processes that must be reduced to different time stages for study. This chapter conceptualizes this process through three distinct stages. There is also a need to differentiate defining the process and defining the factors that influence the process. These distinctions are made clear when viewing the conceptual model provided in Figure 3.1.
The top sector of the model (Figure 3.1) provides the conceptual process of a PPP for economic development. The design provides visual representation of how the process occurs in stages. Starting at the top, the model displays what goes into one of these partnerships. The coming together of a Public Sector entity and a Private Sector entity with a common ground for development form a Public Private Partnership. Following this joining of these parties on the diagram, the process is shown. It starts in the design stage (Stage 1), which is where the structuring and planning occurs. This is where the partners will come together to establish their goals, assess the current conditions of the market and local community, plan the development, define the roles and responsibilities of each partner, and structure a contract.
Stage 2 of the model provides a breakdown of what occurs during the actual implementation of the plan. It is during this stage where the development or construction occurs, the operation and maintenance happens, the meetings between partners, and the
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always possible obstacles sometimes occur. Finally, moving to the far right of the diagram, the outcomes of the process are displayed in Stage 3. The outcomes will either be the result of a completed project or it could be the failure of a project.
The lower half of the model displays the factors that influence the process of a PPP for economic development. This is where the dependent and independent variables are shown and the process that will be studied is demonstrated. The same layout is present as in the conceptual process half with the presence of three stages. Stage 1 is a list of the factors of the design stage that influence the outcomes of the project. It is shown here that the type of funding present from each partner, the involvement of local stakeholders, the amount of focus on local needs, and the amount of focus aimed to plan for low-income and distressed areas all effect the outcomes of the project. Stage 2, the implementation stage, also consists of factors that affect the outcomes of the project and the impact on the surrounding area. The types of managerial responses to unforeseen issues, the sharing of power by each partner, the use of local academic and consulting institutions, and the frequency of meetings during implementation all have a substantial influence on the outcomes of the process. All factors mentioned here make up the independent variables of the study.
The final two bubbles on the diagram show the dependent variables: a successful or unsuccessful outcome and satisfactory or unsatisfactory results. These outcomes will be measure in the following ways: either positive or negative economic success, measured by number of jobs, poverty, income, property values, and contract rents and either satisfactory or unsatisfactory results based on reactions from the actors of the partnership as well as the local citizens. This design provides the bases for the hypotheses.
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Figure 3.1: Conceptual Model of a PPP for Economic Development
20 3.1 – Hypotheses
Three hypotheses based on the literature and conceptualization of this study are presented. They come from the structuring of the process into the first two time stages while determining the effect on the third. The three hypotheses will be introduced here with the breakdown of each, and the factors to be included are addressed in more detail later in the methodology chapter. Each null and alternative hypothesis are as follows:
Null Hypothesis 1: The economic characteristics of the neighborhoods where PPP projects have taken place have not been impacted (no change) over time.
Alternate Hypothesis 1: The economic characteristics of the neighborhoods where PPP projects have taken place have been impacted (positive change) over time.
Null Hypothesis 2: The factors that make up the design stage of a Public Private Partnership for Economic Development do not result in positive impacts on the outcomes in the community where it takes place.
Alternate Hypothesis 2: The factors that make up the design stage of a Public Private Partnership for Economic Development result in positive impacts on the outcomes in the community where it takes place.
Null Hypothesis 3: The factors that make up the implementation stage of a Public Private Partnership for Economic Development do
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not result in positive impacts on the outcomes in the community where it takes place.
Alternate Hypothesis 3: The factors that make up the implementation stage of a Public Private Partnership for Economic Development result in positive impacts on the outcomes in the community where it takes place.
The second hypothesis reflects the Design Stage of the conceptualization model. It is believed that the factors that make up this design stage are influential in creating the different types of outcomes (successful, unsuccessful, satisfactory, and unsatisfactory).
This hypothesis will be broken down into four sub-hypotheses, each tested by the factors that make up the design stage. These include the total amount of funding from each partner, the involvement of local stakeholders, and the amount of focus on planning for the local community’s needs. More specifically, if there is a fair amount of sharing from the partners, a significant amount of involvement from local stakeholders, and a strong emphasis on local needs, the project will result with successful outcomes and provide high satisfaction rates.
The third hypothesis is similar to the second but reflects the Implementation Stage of the conceptualization model. Here it is believed that the factors making up this stage also have significant impact on the type of outcome of the project. The types of managerial responses to unforeseen issues, the sharing of power by each partner, the frequency of meetings between partners and the use of local academic and consulting institutions will be used to measure this hypothesis. Specifically, if an external response system is used, equal and fair powers and responsibilities are displayed, partners frequently meet to discuss
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ongoing objectives and goals, and local institutions are used for project and research aid, the projects will result in successful and satisfactory outcomes.
In Chapter 5 of this Thesis, Table 5.1 displays each of these sub-hypotheses as well as the way they will each be measured. These hypotheses will be put to the test under circumstances in three large cities in the Rust Belt region of the United States. They will be tested with the desire of seeing what factors are used to implement successful outcomes and to see what effects are exposed on these cities. Many projects will be tested with these hypotheses and significant findings are expected to be seen caused by the projects in these struggling areas.
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